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TMI Blog2024 (10) TMI 105X X X X Extracts X X X X X X X X Extracts X X X X ..... ing following substantial questions of law arising out of the judgment and order dated 1st April 2024 passed by the Income Tax Appellate Tribunal, Surat (for short, "the Tribunal") in ITA No.43/SRT/2024 for the Assessment Year 2011-12: "(i) Whether on the facts and circumstances of the case and in law, the Hon'ble ITAT has justified in dismissing the appeal of the Revenue against the decision of the Ld CIT(A) in restricting the addition made by the AO at the rate of 100% of bogus purchases amounting to Rs. 173,89,14,095/- to 6% of the bogus purchases, ignoring the fact that these purchases are sham transactions fabricated through bogus paper concerns of Bhanwarlal Jain Group companies which were engaged in providing accommodation entries? ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... was unexplained/bogus, entire amount of bogus expenditure was to be added to income of Assessee? * the ratio of judgement of Hon'ble Apex Court on the issue of unexplained expenditure (bogus purchase) in the case of N.K. Proteins v. Dy. CIT [2017] 84 taxmann.com 195/250 Taxman 22 (SC) wherein, the SLP filed by the assessee has been dismissed by the Hon'ble Apex Court? (v) Whether on the facts and circumstance of the case and in law, the Hon'ble ITAT is justified in dismissing the appeal of the revenue wherein the AO has transaction made 100% addition of bogus amounting to Rs. 173,89,14,095/- made by the Assensee with the entry provider not appreciating that non genuineness of the expenditure booked was established by the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Officer under Section 144 read with Section 263 of the Act by disallowing the entire purchases of Rs. 1,73,89,14,095/- and penalty proceedings were initiated. [3.6] Being aggrieved, the assessee preferred an appeal before the CIT (Appeals), Surat, who, vide order dated 21st November 2023 partly allowed the appeal of the assessee restricting the addition to 6% of the bogus purchases. [3.7] Feeling aggrieved, the Revenue preferred an appeal before the Tribunal. The Tribunal, by the impugned order dated 1st April 2022 partly allowed the appeal of the Revenue and restricted the disallowance at 6% of bogus purchases. [4] At the outset, learned advocate Mr. Rudram Trivedi for the appellant-Revenue submitted that the Tribunal has relied upon t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ced the contentions of the assessee that confirmation, purchase bills, bank statement, stock register, copy of ITR were already filed. The Assessing Officer was, however, of the view that transactions were bogus and merely that it routed through the banking channel, was not sufficient to conclude that they were the genuine transactions. The contention of the assessee that he had not dealt with the Bhanvarlal Jain group was also negatived. The appellate Commissioner took the view that disallowance was required to be sustained at 12.5% of the purchase. The Assessing Officer was directed accordingly to workout disallowance. In para 10.6, the Commissioner of Income Tax (Appeals), recorded thus," As held above, it is clear that the appella ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ,25,040/-. Thereafter, the issue was dealt with by the appellate Tribunal. The appellate Tribunal endorsed to the view taken by the appellate Commissioner. It was observed that Assessing Officer failed to consider the evidence furnished by the assessee. 5.3 Considering the facts and relevant aspect, the Income Tax Appellate Tribunal partially allowed the appeal of the assessee to further reduce the disallowance at 6%. In so concluding, the Tribunal observed in paragraph No. 21 as under, ".......during the financial year under consideration the assessee has shown total turnover of Rs. 66,09,62,458/-. The assessee has shown Gross Profit @ 78% and net Profit @ 0.02% (page 11 of paper Book). The assessee while filing the return of income ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of appeal raised by the assessee is partly allowed and the grounds of appeal raised by revenue are dismissed." 6. The view taken and the conclusion arrived at by the appellant Tribunal are based on material before it and after analysing the facts and figure available before it. When the Tribunal has thought it fit to reduce the disallowance at 6% from 12.5%, the Tribunal had before it the facts which were duly analysed by it. No interference is called for in the said conclusion and findings of the Tribunal in the present appeal by this court. 6.1 The another weighing aspect is that the Tax Appeal No. 674 of 2022 in Principal Commissioner of Income Tax 1, Surat vs. M/s. Surya Impex which came to be decided by the co-ordinate Bench on 1 ..... X X X X Extracts X X X X X X X X Extracts X X X X
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